Written by Gary
US stock index futures are set for a higher open New Year’s Eve (SPY +0.7%) on growing optimism surrounding US-China trade talks.
Here is the current market situation from CNN Money | |
 | European markets finished mixed as of the most recent closing prices. The DAX gained 1.71% and the CAC 40 rose 1.11%. The FTSE 100 lost 0.09%. |
What Is Moving the Markets
| Here are the headlines moving the markets. | |
 | U.S.-China trade progress boosts futures at end of turbulent yearU.S. stock index futures rose on Monday, boosted by signs of progress in the U.S.-China trade dispute and rising crude oil prices, setting up Wall Street to end its worst year in a decade on an upbeat note. |
| U.S. companies repatriate over half a trillion dollars in 2018, but pace slowsU.S. companies have sent home over half a trillion dollars of cash they held overseas in 2018 to take advantage of tax changes, but data suggest the pace is slowing, potentially removing a key source of support for Wall Street. |
| Canada Goose’s first China store draws eager crowds despite diplomatic headwindsLarge crowds have been drawn to Canada Goose’s new outdoor wear store in downtown Beijing, its first in mainland China, since its opening on Friday, despite sub-zero temperatures and a chill in China’s relations with Canada. |
| Brent crude rises over $1, but set for first yearly drop since 2015Oil prices rose more than 2 percent on the final day of the year, mirroring gains in stock markets, but were on track for their first annual decline in three years as concerns of a persistent supply glut lingered. |
| Fed Chair Powell’s unscripted approach sets up for rocky 2019Jerome Powell had a bumpy first year as Federal Reserve chairman when it came to talking policy, by turns spooking and comforting investors even as economic data offered increasingly mixed signals and President Donald Trump stepped up his attacks on the U.S. central bank. |
| Tokyo court says extends detention of Nissan’s Ghosn until Jan 11The Tokyo District Court said on Monday it has extended the detention of ousted Nissan Motor Co chairman Carlos Ghosn by 10 days until Jan. 11. |
| Stocks pin hopes on U.S.-China trade talks after brutal yearWorld share and commodity prices rose on Monday as hints of progress on the Sino-U.S. trade standoff provided a rare glimmer of optimism in what has been a punishing end of year for markets globally. |
| China factory activity shrinks for first time in over two years, 2019 looks tougherChina’s factory activity contracted for the first time in over two years in December, highlighting the challenges facing Beijing as it seeks to end a bruising trade war with Washington and reduce the risk of a sharper economic slowdown in 2019. |
| China’s services activity picks up in December: official PMIGrowth in China’s services industry picked up in December after a two-month slowdown, an official survey showed, offering some respite for the slowing economy though the outlook remains gloomy as domestic and external risks to growth rise. |
| Lashing Out At Mattis And Kelly, Trump Says “Failed Generals” Need To Stop ComplainingPresident Trump once prided himself in the fact that he had stocked his administration with capable military men like ex-Defense Secretary James Mattis and now-former Chief of Staff John Kelly. But as both men have departed his administration – with Mattis explicitly citing Trump’s decision to pull US troops out of Afghanistan and Syria, and Kelly criticizing these decisions in an exit interview – Trump Monday morning lashed out at “failed generals” who “complain” about Trump’s decision to fulfill his campaign promise to finish the “never-ending” wars in the US.
Trump also reminded Americans that he campaigned on ending wars like Afghanistan, which has dragged on for 17 years, while circumstances in the country have only seemed to deteriorate further.
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| China PMI Unexpectedly Plunges Into Contraction – Weakest December Since 2008China’s official manufacturing PMI fell to 49.4 in December, from 50.0 in November, the lowest reading since February 2016; and the weakest reading for a December since 2008.
Under the hood, it was just as ugly, as Goldman notes, both the production and new order sub-indexes fell in December. The production index declined to 50.8 from 51.9, and the new orders decreased to 49.7 from 50.4. Trade indicators continued to soften as well – the imports sub-index dropped 1.2pp to 45.9 and the new export order sub-index was at 46.6, vs. 47.0 in November. Both indexes were at the weakest levels since late 2015/early 2016. The employment sub-index edged down slightly by 0.3pp to 48.0. Inventory indicators went down – the raw material inventories index was 0.3pp lower, and the finished goods inventory index dropped by 0.4pp in December to 48.2. Inflationary pressures eased meaningfully – the input price index dropped by 5.5pp to 44.8, the lowest level since December 2015, and the output prices index was 3.1pp lower at 43.3. |
| Mexican Army Starts Major Crackdown On Fuel TheftAuthored by Tsvetana Paraskova via Oilprice.com, Mexico’s military have taken control over 58 key fuel installations in the country, including refineries, upon orders by new President Andres Manuel Lopez Obrador, who has vowed to fight corruption and fuel theft within and outside state-run energy company Pemex.
Lopez Obrador unveiled a plan on Thursday to increase the presence of military and the use of the army in fighting rampant fuel theft that has been costing Mexico’s state firm Pemex billions of dollars annually. According to Pemex’s own estimates, the losses from fuel theft over the past three years have reached US$7.5 billion (147 billion Mexican pesos). According to Lopez Obrador, authorities are also involved in widespread fuel t … |
| Global Stocks Jump On Last Day Of 2018, Lifted By Trump-Xi Trade OptimismIt’s only fitting that the biggest geopolitical event of 2018, the US-China trade war, is also the defining factor setting the market mood on the last day of trading, and after Trump’s Saturday tweet that U.S.-China negotiations were “moving along very well” toward a comprehensive deal, global stocks and US equity futures are a sea of green.
The euphoria returned, however briefly, even though the WSJ warned to take Trump’s tweet with a grain of salt, especially since given the market volatility Trump is liable to be exaggerating the chances of a deal, especially since trade optimism is expected to boost markets, Trump’s favorite “barometer” of his administration.
The tweet also followed a Friday CNBC report that the White House had spoken with a prominent hedge fund investor how to halt the marke … |
| Futures Movers: Oil firms in step with stocks but will close the book on painful month, yearOil futures prices firm Monday alongside stock-market gains in the final trading day of a volatile 2018 that still leaves major energy benchmarks down roughly 40% from the four-year highs scored as recently as October. |
| Need to Know: Expect more 1,000-point swings for the Dow in 2019: Mohamed El-ErianIt’s the end of a long year and what have we learned? Volatility will be our friend in 2019, that’s according to our call of the day from Allianz’s top economic adviser, Mohamed El-Erian. |
| Bond Report: Treasury yields hold ground amid U.S.-China trade optimismTreasury yields trade mostly unchanged on Monday in a holiday-shortened session amid hopes for further progress on U.S.-China trade negotiations. |
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